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Daehan New Pharm Co., Ltd. Analysis of Financial Results for January–September 2010

2010.11.04

Daehan New Pharm Co., Ltd. Analysis of Financial Results for January–September 2010

1. Increase in Sales Revenue

(1) Third Quarter

- Compared to the same period of the previous year, product sales increased by 23.1% and merchandise sales by 528.3%, recording a total growth rate of 25.4%.

(Unit: Million KRW)

	Classification	Q3 2010	Q3 2009	Change	Change (%)
Sales	Products	12,284	9,979	2,305	23.1%
	Merchandise	289	46	243	528.3%
	Total	12,573	10,025	2,548	25.4%

(2) Cumulative (January–September)

- Compared to the same period of the previous year, product sales increased by 13.5% and merchandise sales by 92.9%, achieving total growth of 15%.

(Unit: Million KRW)

	Classification	Jan–Sep 2010	Jan–Sep 2009	Change	Change (%)
Sales	Products	32,975	29,054	3,921	13.5%
	Merchandise	1,107	574	533	92.9%
	Total	34,082	29,628	4,454	15.0%

2. Operating Profit and Income Before Income Taxes from Continuing Operations

(1) Third Quarter

- Operating profit increased by KRW 180 million (11.6%) compared to the same period of the previous year.

- Income before income taxes from continuing operations increased by KRW 590 million (1,414.3%) compared to the same period of the previous year.

(Unit: Million KRW)

	Q3 2010		Q3 2009		Change	Change (%)
	Amount	Profit Rate	Amount	Profit Rate	Change	Change (%)
Operating Profit	1,705	13.6%	1,528	15.2%	177	11.6%
Non-operating Income	81		105		-24
Non-operating Expenses	1,150		1,591		-441
Income Before Income Taxes (Continuing Operations)	636	5.1%	42	0.4%	594	1414.3%

1) Operating profit in 2010 was KRW 1.70 billion (margin 13.6%) compared to KRW 1.53 billion (margin 15.2%) in 2009, showing an increase of KRW 180 million over the previous year.

2) Income before income taxes from continuing operations was KRW 640 million (margin 5.1%) in 2010, compared to KRW 40 million (margin 0.4%) in 2009, an increase of KRW 590 million year-on-year.

(2) Cumulative (January–September)

- Operating profit increased by KRW 440 million (10.4%) compared to the same period of the previous year.

- Income before income taxes from continuing operations was KRW 2.47 billion, a decrease of KRW 1.7 billion compared to the previous year, mainly due to a reduction in non-operating income (interest income).

(Unit: Million KRW)

	Jan–Sep 2010		Jan–Sep 2009		Change	Change (%)
	Amount	Profit Rate	Amount	Profit Rate	Change	Change (%)
Operating Profit	4,679	13.7%	4,237	14.3%	442	10.4%
Non-operating Income	1,433		3,614		-2,181
Non-operating Expenses	3,640		3,922		-282
Income Before Income Taxes (Continuing Operations)	2,472	7.3%	3,929	13.3%	-1,457	-37.1%

1) Operating profit in 2010 was KRW 4.68 billion (margin 13.7%), compared to KRW 4.24 billion (margin 14.3%) in 2009, showing an increase of KRW 440 million over the previous year.

2) Income before income taxes from continuing operations was KRW 2.47 billion (margin 7.3%) in 2010, compared to KRW 3.93 billion (margin 13.3%) in 2009, showing a decrease from the previous year.

(Unit: Million KRW)

	Jan–Sep 2010	Jan–Sep 2009	Change	Remarks
Interest Income	121	1,721	-1,600

- 2009 (January–September): Interest income of KRW 1.7 billion (USD 1,318,744.62) was generated from loans totaling USD 11 million.

- Income before income taxes from continuing operations decreased by approximately KRW 1.46 billion (37.1%) compared to the same period of the previous year, mainly due to the decline in interest income from loans.

3. Improvement in Financial Structure

- Significant reduction in long-term loans.

(Unit: Million KRW)

	Jan–Sep 2010	Jan–Sep 2009	Change	Remarks
Long-term Loans	5,482	25,687	-20,205
Total Assets	125,057	111,827	13,230
Ratio to Total Assets (%)	4.4%	23.0%	-18.6%

(1) The long-term loan of USD 11,000,000 to GALAZ ENERGY B.V. was converted into equity as of February 22, 2010.

(2) The loan of USD 6,200,000 to BNG ENERGY B.V. was converted into equity as of May 7, 2010.

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